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Stockholders' Equity

9 Months Ended

Mar. 31, 2021

Stockholders' Equity

Stockholders' Equity

9. Stockholders’ Equity

Stock-based Compensation

As of March 31, 2021, we maintained the Amended and Restated 2012 Incentive Award Plan (the "2012 Plan ") and the Amended and Restated 2006 Equity Participation Plan ("2006 Plan") as stock-based employee compensation plans. No further grants may be made under the 2006 Plan. The 2012 Plan and the 2006 Plan are collectively referred to as the "OSI Plans."

We recorded stock-based compensation expense in the consolidated statements of operations as follows (in thousands):


		Three Months Ended March 31,						Nine Months Ended March 31,
		2020			2021			2020			2021
Cost of goods sold		$	189		$	199		$	517		$	571
Selling, general and administrative			5,520			7,223			17,153			18,391
Research and development			128			143			427			424
Stock-based compensation expense		$	5,837		$	7,565		$	18,097		$	19,386

As of March 31, 2021, total unrecognized compensation cost related to share-based compensation grants under the OSI Plans were estimated at $0.5 million for stock options and $20.7 million for restricted stock units (“RSUs”). We expect to recognize these costs over a weighted average period of 2.1 years with respect to the stock options and 1.9 years for grants of RSUs.

The following summarizes stock option activity during the nine months ended March 31, 2021:


				Weighted
				Average			Weighted-Average		Aggregate
		Number of		Exercise			Remaining Contractual		Intrinsic Value
		Options		Price			Term		(in thousands)
Outstanding at June 30, 2020		326,304		$	44.41
Granted		22,171			82.17
Exercised		(87,235)			34.44
Expired or forfeited		(2,710)			78.71
Outstanding at March 31, 2021		258,530			50.65		2.8 years		$	11,818
Exercisable at March 31, 2021		222,512			45.03		1.8 years			11,387

The following summarizes RSU award activity during the nine months ended March 31, 2021:


				Weighted-
				Average
		Shares		Fair Value
Nonvested at June 30, 2020		423,590		$	88.68
Granted		337,778			80.32
Vested		(310,939)			86.20
Forfeited		(8,244)			84.47
Nonvested at March 31, 2021		442,185		$	84.12

In December 2020, our shareholders authorized an increase of 1.65 million shares for the 2012 Plan resulting in a maximum pool of 7.1 million shares. As of March 31, 2021, there were approximately 2.1 million shares available for grant under the 2012 Plan. Under the terms of the 2012 Plan, RSUs and restricted stock granted from the pool of shares available for grant reduce the pool by 1.87 shares for each award granted. RSUs and restricted stock forfeited and returned to the pool of shares available for grant increase the pool by 1.87 shares for each award forfeited.

We granted 81,621 and 136,242 performance-based RSUs during the nine months ended March 31, 2020 and 2021, respectively. These performance based RSU awards are contingent on the achievement of certain performance metrics. The payout related to these awards can range from zero to 400% of the original number of shares or units awarded. Compensation cost associated with these performance based RSUs are recognized based on the estimated number of shares that we ultimately expect will vest. If the estimated number of shares to vest is revised in the future, then stock based compensation expense will be adjusted accordingly.

Stock Repurchase Program

In April 2020, the Board of Directors authorized a share repurchase program of up to 1,000,000 shares of common stock. In August 2020, the Board of Directors increased the maximum number of shares to 3,000,000 shares authorized under the stock repurchase program. This program does not expire unless our Board of Directors acts to terminate the program. The timing and actual numbers of shares purchased depends on a variety of factors, including stock price, general business and market conditions and other investment opportunities. Repurchases may be made from time to time under the program through open-market purchases or privately-negotiated transactions at our discretion. Upon repurchase, the shares are restored to the status of authorized but unissued shares and we record them in our consolidated financial statements as a reduction in the number of shares of common stock issued and outstanding.

During the nine months ended March 31, 2021, we repurchased 322,588 shares of our common stock.

Dividends

We have not paid any cash dividends since the consummation of our initial public offering in 1997 and we do not currently intend to pay any cash dividends in the foreseeable future. Our Board of Directors will determine the payment of future cash dividends, if any. Certain of our current bank credit facilities restrict the payment of cash dividends and future borrowings may contain similar restrictions.